The pizza industry has always been a safe-haven for franchise investors and operators. The pizza business, valued at $58.3 billion in 2022, is an industry that’s still in growth mode after all these years. Pizza is in demand during booms and a good value play during recessionary times. One of the interesting chains in this sector is Mountain Mike’s Pizza with 265 total units and plenty of room to expand.
How much does it cost to open Mountain Mike’s? You’ll need a liquid capital of $100,000 and a net worth of $300,000 to qualify from a financial perspective. The average investment range is $417,850 – $798,500 and the franchise fee is $15,000 – $30,000. Considering more than half of the Mountain Mike’s Pizza units generate $1 million or more in gross revenue per year, it’s a franchise investment many operators find appealing.
Want to see my analysis of the Mountain Mike’s Pizza and their legendary crispy and curly pepperonis? Check out my review below or take this 7-minute franchise quiz to be custom matched with a pizza chain.
Financial Requirements and Fees
|Fees / Expenses
||$417,850 to $798,500
||$15,000 to $30,000
Here’s a breakdown of the total investment:
|Initial Franchise Fee
||$15,000 to $30,000
||On signing Franchise Agreement
||$130,000 – $366,000
|Architectural and Engineering Fees
||$12,500 – $16,500
|Furniture, Fixtures, and Equipment
||$160,000 – $213,000
||$8,500 – $17,000
|POS/Electronic Information System
||$10,800 – $15,500
|Three Months’ Rent/td>
||$6,750 – $33,000
||As specified in lease or sublease
||$5,000 – $10,000
||On signing lease or sublease
|Opening Inventory and Supplies
||$20,000 – $29,000
||On signing Franchise Agreement
||$9,000 – $12,000
|Training Expenses (for all attendees)
||$1,300 – $4,000
||$0 – $5,500
|Miscellaneous Opening Costs
||$20,000 – $29,000
|Additional Funds – 3 months
||$20,000 – $24,000
|TOTAL ESTIMATED INITIAL INVESTMENT
(excluding real estate purchase costs)
|$417,850 – $798,500
In addition to this, Mountain Mike’s charges a 5% royalty fee and 3% ad royalty fee. Veterans can avail of a discount of 50% off franchise fee. The term of agreement is 15 years and can be renewable.
Mountain Mike’s Franchise Facts
Mountain Mike’s Pizza started in 1978 in Palo Alto, California. The owners were friends Chris Britt and Ed St. Geme who met in Stanford University. What started as just one location is now over 260 restaurants in the span of more than 40 years.
The menu at Mountain Mike’s consists of pizza, wings, and sandwiches. Their pizza specifically is the main item and they’re known for their pepperoni pizza that’s topped with loads of crispy and curved pepperoni. They also serve a variety of sides, salads, and desserts. They also offer a pizza and salad bar buffet during lunch hours.
To franchise Mountain Mike’s Pizza, complete the franchise form here. You’ll be scheduled for an interview once they’ve received and checked your details. Afterwards, you’ll get to read their Franchise Disclosure Document so you can get the full picture. Once signed, you’ll also have to pay the franchise fee.
Mountain Mike’s Pizza delivers profits.
Site selection follows next. This is the step wherein you’ll be able to choose where to put up your franchised Mountain Mike’s. Afterwards, you’ll go through their training process so you can ultimately be ready for your grand opening.
Chris Britt and Ed St. Geme remain as Co-CEOs and directors of the business. Their headquarters is located at Newport Beach, California.
How Much Does Mountain Mike’s Generate in Revenue and Profit?
According to their franchising website, their unit volume reaches $1,608,631 for the top 16% of their restaurants. You can view this more unit sales data below at the Mountain Mike’s Pizza franchise website:
|Greater than $1,500,000
|$1,250,000 to $1,500,000
|$1,000,000 to $1,250,000
|$750,000 to $1,000,000
|$500,000 to $750,000
Of course sales does not equal profit at a pizza shop. There’s overhead like taxes, labor, lease, ingredients, insurance, and other expenses. If you used a standard net-profit margin of 15% here are some back of the napkin profit estimates based on annual sales.
Annual Net Profit Projections:
- $241,294 net profit projection for $1,608,631 of gross revenue.
- $187,500 net profit projection for $1,250,000 of gross revenue.
- $150,000 net profit projection for $1,000,000 of gross revenue.
- $112,500 new profit projection for $750,000 of gross revenue.
- $75,000 new profit projections for $500,000 of gross revenue.
Make sure to review and complete your due diligence by reviewing the latest FDD document to get the latest financial data for the chain.
Advantages of a Mountain Mike’s Franchise
Mountain Mike’s Pizza offers a number of distinct advantages in the pizza industry. Here are a few I found particularly valuable:
Runway for Growth
The pizza industry is worth billions so there is plenty of space for different successful specialty players in the industry. Mountain Mike’s sales have grown yearly and pizza is a simple menu item that everyone always loves.
But one distinct advantage of Mountain Mike’s is that with only 265 total units the concept is not saturated in most markets like you could see with a franchise like Domino’s that is approaching 20,000 global locations. Based on the number of units from competitors, it wouldn’t be unheard of for the concept to double or triple in the number of total units over the next 5 – 10 years.
Regional Name Recognition
Mountain Mike’s is a big name in California and they’re continuing to expand in Central and Southern California, Nevada, Oregon, Arizona, Colorado, Washington, Utah and Idaho.
The company has successfully partnered with sports teams and is recognized as the official pizza of the San Francisco 49ers that helps the pizza chain get introduced to new customers.
Another distinction with Mountain Mike’s is they have zigged while competitors have zagged. Over the past few years, large pizza chains have focused on delivery and in-store pickup service. Mountain Mike’s has taken a different approaching by emphasizing on-site dining.
Strategies that Mountain Mike’s uses to lure customers into their stores include a pizza and lunch buffet, video game arcade, and local draft beer and other alcohol and happy hour deals. If you want to make more of a face-to-face connection with patrons this could be a good option.
Mountain Mike’s boasts of using high quality and fresh ingredients such as 100% whole milk mozzarella cheese. They’re also well known for their curly, crispy pepperoni. They have products that are quite popular which makes them unique from other chains.
Challenges of a Mountain Mike’s Franchise
Even franchising a business like Mountain Mike’s will have a set of challenges in store for you. Here are some to expect:
No Global Presence
Mountain Mike’s has no global presence as of the moment. They’re only located in the United States and their locations are also limited to California, Oregon, Nevada, Utah, Arizona and Idaho at present. If you plan to open a new store in a state where consumers don’t have awareness of your brand, it could mean you’ll need to work much harder to get the name out there in the community from a marketing perspective.
The pizza industry is a massive opportunity valued at more than $58 billion. With opportunity comes lot of competition such as those like Domino’s, Pizza Hut, and Papa Johns to name a few. Most of those names are also located worldwide and have massive national advertising campaigns to get their message out. Theses larger chains can also benefit from the advantages of scale and the ability to invest in technology and further streamline efficiency. As a smaller franchise, the reality is that Mountain Mike’s has fewer resources in these areas.
Labor Shortages and Rise Wage Costs: This is a challenge for most pizza shops, but worth noting here as well. Hiring skilled lower-wage workers and retaining them can be a challenge, especially in the face of labor shortages and rising wages in certain regions.
Is the Mountain Mike’s Franchise Right For You?
Mountain Mike’s is a simple pizza franchise that has stayed true to its roots for 45 years. So if you want a good old classic American pizza business then Mountain Mike’s is an option worth evaluating further.
Mountain Mike’s Pizza options.
What is an alternative Mountain Mike’s franchise?
Another pizza chain that’s worth looking into is Pizza Hut. They have over 17,000 locations worldwide and their name is well-known all over the globe for their pan pizzas with a variety of flavors and toppings.
To franchise Pizza Hut, expect the investment to be $297,000 – $2,109,000. Read our full guide on franchising Pizza Hut here.
Mountain Mike’s continue to be a pizza brand that’s growing every year so if you think you have what it takes to franchise with them then I hope this guide was able to help you understand more about this opportunity.